Australian statisticians have raised the bar on estimates for Argentina's soybean harvest to 57.2m tonnes – well above other forecasts – in a report cutting price estimates for both the oilseed and wheat.

Argentina's soybean crop will beat last year's by 60% thanks to a switch by farmers from growing grains, the Australian Bureau of Agricultural and Resource Economics said.

"This switch has been driven by a longer planting window for soybeans relative to corn during the spring, and higher returns for soybeans," Abare said.

The figure compares with a 53.0m-tonne estimate from the US Department of Agriculture and a 48.0m-tonne forecast from Oil World, the respected German-based analysis group which has warned over the impact of dry weather on the crop.

Oil World restated its projection in a report on Tuesday warning that soybean prices were "set to come under considerable pressure" over the next three-to-six months assuming even its forecast for Argentina's crop, and a 63.7m-tonne harvest in Brazil, were realised.

Lower prices 

Abare predicted Rotterdam soybean prices would average $375m in 2009-10, an $18-a-tonne cut from its September estimate and down 10.9% on prices the year before.

Total oilseed output would rise by 8.6% to 429m tonnes, Abare said, lifting its production forecast, while leaving its consumption guess unchanged at 413m tonnes, up 3.3% year on year.

The bureau also cut its forecast for the average wheat price in 2009-10 by $11 to $190 a tonne, citing stocks replenished by the second-biggest global harvest, following on from last year's record high.

The wheat price, represented by US hard red winter wheat, averaged $271 as tonne in 2008-09.

However, Abare raised hopes for average corn prices - as represented by Gulf of Mexico shipments free on board - by $5 a tonne to $161 a tonne, noting weaker Chinese production and rising consumption by ethanol plants.

Farms slip into loss 

The bureau also cut hopes for Australia's agriculture exports by Aus$2bn to Aus$30bn, citing its reduced wheat crop forecast and the impact of foreign exchange changes.

For wheat, "because of a lower world price and an assumed higher Australian dollar, the value of exports is forecast to fall by 15% to Aus$4.3bn", Abare said in a quarterly commodities report.

Commercial grain and meat farms were set to report a loss averaging Aus$11,000 in 2009-10, compared with a small profit a year before.

Dairy farms would fall Aus$55,000 into the red from a profit of Aus$7,900 in 2008-09.